Date of validity. This agreement is concluded and concluded on [DATE]. I prefer to refer to the date of this agreement. Why add an unnecessarily defined term to the reader? First, the validity date is sometimes used to refer to the date indicated in the introductory clause, as in this example – which I did not correct while I changed the names – of the SEC`s EDGAR database: this contract takes effect on the day the contract is signed by both parties (the “validity date””) If a contract is dated by dating their signatures by the parties , instead of putting a date in the introductory clause (something I mention in this blog post), we see that the validity date is used to refer to the date on which all parties signed: Sometimes the parties use the validity date to refer to a future date on which either agreement enters into force. For example, a January 2004 employment contract is likely related to the date on which the employee will actually begin work: CET SERVICES GESTION ACCORD (this “agreement”) will be concluded on May 4, 2007 (effective date) of and between Acme Holding Corporation (“Acme”), Astute Advisors LLC (Contractor) and Don R Jones (“Jones”). Ken Adams of Koncision argues that, in these circumstances, it is clearer to include the date of the agreement in the introductory clause and to characterize that date as “the date of that agreement”. For example, “This agreement is concluded and concluded on [DATE] by [PARTIES].” Ken says, “Why add an unnecessarily defined term to the reader?” “Effective Date,” July 2007. But it is misleading to commit to the effectiveness of the agreement on the date the employee will take office, as the agreement will be effective once the parties have signed it. Instead, it is the company`s obligation to pay the employee and the employee`s obligation to work for that salary that starts later, and I would say that in the contract. If you need a defined term to refer you to that day later, I will use something like the start date. 1.1 Effective date. This agreement is binding and is deemed effective if it is executed by all parties (the effective date). The duration of the agreement begins on the first day of the Company`s fiscal year beginning in 2004 (effective date) and ends on the last day of the Company`s fiscal year ending in 2007, subject to prior termination in accordance with Section 7 below (the “duration”).
The clause on the entry into force or effectiveness of the agreement sets the date on which the rights and obligations arising from the agreement come into force. The validity date is not necessarily the same as the execution date. In the absence of an effective date, the terms of the agreement will enter into force after they are implemented. The parties may set an effective date before the agreement is implemented. For example, to recover royalties or payments retroactive to a bygone date. Once again, Ken argues that it is clearer to use the concept of “date of agreement” and to define concretely the periods of rights and obligations that deviate from that date. In practice, it may be more convenient to set the operating date for all rights and obligations rather than to define them individually. It is customary to indicate in a contract the effectiveness of something or something else – perhaps a merger or a registration statement.